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So I've never actually seen one of these agreements, but supposing your stock is in an index, is it also forbidden to go short the index and long in stocks outs
by yummyfajitas 11y ago
So I've never actually seen one of these agreements, but supposing your stock is in an index, is it also forbidden to go short the index and long in stocks outside your sector?
(I expect transaction costs would nuke this idea, but I'm somewhat curious how sophisticated big company employee agreements are.)
- sokoloff 11y agoThat's not covered by my current company's policy (and I don't recall seeing it in any of the other ones), but if you entered into such an arrangement, it would be plainly obvious what your intent was, and the fact that you didn't technically violate the company's agreement wouldn't be an excuse for the company's compliance department nor for the SEC. Short the index and long everything but your SECTOR is probably OK. That's just a bet against your sector. Short the index and long everything except your specific COMPANY is not going to be defensible. (In my policies, it's more straightforward to just short the sector directly, if such an instrument exists.)
- encoderer 11y agoThe SEC is not going to care that you traded in your competitors stock unless you had inside information.